Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


NZ lamb exports fall in May as Chinese demand dwindles

NZ lamb exports fall in May as Chinese demand dwindles

By Rebecca Howard

July 10 (BusinessDesk) - Strong volumes of New Zealand lamb exported through April did not flow into May after Chinese buyers stockpiled inventory earlier in the year, according to AgriHQ.

Total shipments for the month were 30,683 tonnes, down 11 percent versus the same month a year earlier but only 2 percent lower than the five-year average. Total volumes for both frozen and chilled lamb were down between 10 percent and 11 percent, AgriHQ said in its latest monthly sheep & beef report.

In terms of frozen product, the largest decrease was in shipments to China, down 23 percent on the year. Less frozen lamb was also sent through to the UK and the Middle East with volumes to those markets down 11 percent and 19 percent respectively. Chilled lamb exports were particularly low into both the UK and the Middle East, with the UK taking 35 percent less than it did a year earlier while exports to the Middle East dropped 26 percent year-on-year.

AgriHQ said seasonal consumption trends worked against exports selling into China and the Middle East. Chinese buyers were well stocked heading into their summer and now have limited appetite to purchase as inventories are building. Ramadan ran through much of June and was a key reason behind the lower demand in the Middle East, where inventories have also slowly built up. Frozen lamb sales into the UK stalled on the seasonal lift in UK domestic lamb production.

Still, the rising prices and favourable currency movements translated into the second highest average export value for frozen lamb in a May month, AgriHQ said. At $8.21 per kilogram it was 26 percent higher than in May 2016 and only beaten by $8.88/kg in 2011. The average value of chilled lamb was $13.97/kg, up 17 percent on the year but trailing the $15.06/kg achieved in May 2011.

The monthly report shows benchmark prices in June for several meat cuts remained well above the level they were a year earlier.

The benchmark price for a frozen leg of lamb in the UK fell to 4.65 British pounds/kg in June from 5.00 British pounds/kg in May but was well above 3.80 British pounds/kg a year earlier. In the European Union, the benchmark was 5.90 euro/kg, unchanged from May but higher than 5.40 euro/kg a year earlier.

For frozen french lamb racks, the benchmark price in the US rose to US$8.65/pound from US$8.60/pound in May and US$6.80/pound a year earlier. In Europe, the benchmark was 17.25 euro/kg, unchanged from May and up from 13.50 euro/kg a year earlier.

The price for a five-rib forequarter eased to US$5.10/kg, from US$5.35/kg in April and US$4.20/kg a year earlier.

Meanwhile, competitive pressures drove up lamb slaughter prices up in June, in particular on the South Island, and farmers say there is more upside to come,

Procurement competition for lambs lifted sharply through June and "processors readily dug deep into their margins in order to stay competitive within the market," AgriHQ said. This was particularly noticeable on the South Island where slaughter prices lifted 40 cents a kilogram, or 7 percent, in June, temporarily placing the South Island market slightly above the North Island for the first time in more than a decade.

North Island prices rose 35 cents a kilogram in the same period. The national net per head and weighted average price was $6.55/kg in June versus $6.33/kg in May and $5.23/kg a year earlier. Farmers are anticipating slaughter prices will rise another 40 cents-to-50 cents a kilogram by the end of the season, AgriHQ said.

The lamb slaughter has tracked on par with what is common for this point in the year. Data in the four weeks to June 10 put the national lamb kill at 1.48 million lambs, up 12 percent on the year but nearly identical to the five-year average.

AgriHQ also noted that total production volumes are being somewhat inflated by heavier than typical carcass weights. Both the larger kill numbers and the heavier carcass weight come from farmers sending lambs to slaughter later than normal after impressive autumn and early winter feed conditions.


© Scoop Media

Business Headlines | Sci-Tech Headlines


By May 2018: Wider, Earlier Microbead Ban

The sale and manufacture of wash-off products containing plastic microbeads will be banned in New Zealand earlier than previously expected, Associate Environment Minister Scott Simpson announced today. More>>


Snail-ier Mail: NZ Post To Ditch FastPost

New Zealand Post customers will see a change to how they can send priority mail from 1 January 2018. The FastPost service will no longer be available from this date. More>>


Property Institute: English Backs Of Debt To Income Plan

Property Institute of New Zealand Chief Executive Ashley Church is applauding today’s decision, by Prime Minister Bill English, to take Debt-to-income ratios off the table as a tool available to the Reserve Bank. More>>


Divesting: NZ Super Fund Shifts Passive Equities To Low-Carbon

The NZ$35 billion NZ Super Fund’s NZ$14 billion global passive equity portfolio, 40% of the overall Fund, is now low-carbon, the Guardians of New Zealand Superannuation announced today. More>>


Split Decision - Appeal Planned: EPA Allows Taranaki Bight Seabed Mine

The Decision-making Committee, appointed by the Board of the Environmental Protection Authority to decide a marine consent application by Trans-Tasman Resources Ltd, has granted consent, subject to conditions, for the company to mine iron sands off the South Taranaki Bight. More>>